The year-on-year increase has also led to a rise in used car trade values, according to analysts Cap.

Despite 2007 making a slow start to the year in January, the market has rallied and is now much stronger than 12 months ago.

Cap claimed a change in dealer behaviour - with the traditional January rise in used values now muted - was a major factor in producing a stronger market.

Historically, Cap said, dealers tended to liquidate stock during November and December in order to convert their assets into cash for accounting purposes.

Used values during that period would become depressed as supply overtook demand due to the influx of liquidated stock into the open market.

Cap said dealers would then follow this period with a surge in trade buying activity to replenish forecourts in January, creating a clamour of renewed demand and pushing values back up.

The analysts said the 'bust and boom' cycle had flattened out and values no longer dramatically reduce at the end of the year.